The controversy over the expansion of generic top-level domain names (gTLDs) continues.
Last year The Internet Corporation for Assigned Names and Numbers (ICAAN) began rolling out new gTLDs such as .bike, .plumbing, .singles, and .ventures. From the start, trademark holders expressed concern about the creation of the new domain names, as the cost of protecting a brand against cybersquatting or the misuse of terms was $185,000 for an application, with annual renewal rates of $25,000.
Then-Sen. John Rockefeller even wrote to ICANN to ask for a halt on one particular domain: “.sucks.” The gTLD “has little or no socially redeeming value” and poses a costly threat to businesses, the lawmaker wrote. He characterized the potential top domain as “little more than a predatory shakedown scheme.”
“The business model behind this gTLD seems to be the following: forcing large corporations, small businesses, non-profits, and even individuals, to pay ongoing fees to prevent seeing the phrase ‘sucks’ appended to their names on the Internet,” Sen. Rockefeller cautioned.
Although ICANN took no action at the time, the organization recently sent a letter to Edith Ramirez, the Chairwoman of the Federal Trade Commission, and John Knubley, the Deputy Minister of Canada’s Office of Consumer Affairs, concerning the .sucks gTLD.
The letter notes that the Vox Populi Registry was selected by ICANN to operate the .sucks domain. The Canadian company had already signed a registry agreement and initiated the process of selling second-level domain name registrations.
As the process began, ICANN’s Intellectual Property Constituency reiterated many of the same concerns expressed by Sen. Rockefeller. It described Vox Populi’s business practices as “illicit” by encouraging third parties to register for brand names in order to nudge trademark holders into paying an annual $2,500 fee to register defensively.
“We believe that the registry operator’s actions in establishing this predatory scheme are complicit in, and encourage bad faith registrations by third parties at the second level of the .sucks gTLD, and thus drastically increase the likelihood of trademark infringement, all for commercial gain,” the IP Constituency wrote.
John Jeffrey, ICANN’s general counsel, then asked the regulators for help.
“ICANN is concerned about the contentions of illicit actions being expressed, but notes that ICANN has limited expertise or authority to determine the legality of Vox Populi’s positions, which we believe would fall within your respective regulatory regimes.”
The group formally requested that both the Canadian and U.S. authorities “consider assessing and determining whether Vox Populi is violating any laws or regulations enforced by your respective offices.” ICANN is already evaluating remedies available under its registry agreement to act consistently with public interest goals and consumer and business protections.
“We are very concerned about any possible illegality resulting from the alleged actions of the registry and accordingly reach out to you to see if you can offer guidance on this matter,” Jeffrey added.
Time is of the essence, as the early registration period—during which only trademark holders and celebrities can register with the gTLD—ends May 29. In June anyone will be allowed to register a “.sucks” domain for as little as $10.
To read ICANN’s letter to the FTC and Canadian Office of Consumer Affairs, click here.
Why it matters: The .sucks domain has always been controversial. Trademark owners have tried litigating against individuals and companies that have used their marks in such domains. Now the gTLD is attracting regulatory attention. Many brands and well-known individuals are not waiting on the government to act. Companies such as Apple and Home Depot and celebrities including Oprah and Taylor Swift have made sure to register during the current period to protect their names from being used in this nefarious manner. In response to the letter, Vox Populi maintained that the company has “colored well within the lines both of ICANN’s rules and national laws,” and company CEO John Berard told Law360 that he was “surprised” by the letter.